Insurers have also been barred from repudiating on grounds of fraud if the insured can prove that the there was no deliberate intention to suppress facts.

For premium increases at the time of renewal, IRDAI said customers would have to be informed three months in advance.

Claims settlement
IRDAI said that for all policies an insurer has to settle or reject a claim within 30 days from the date of receipt of the last necessary document.

ln the case of delay in the payment of a claim, the insurer has to pay an interest rate of 2 percent above the bank rate. The latter is a rate fixed by the Reserve Bank of India (RBI) at the beginning of each financial year and it currently stands at 4.25 percent.

In cases where the health insurance claim demands an investigation, insurers have to initiate and complete this process within 30 days from the date of receipt of last necessary document. Here, insurers have 45 days’ time to settle or reject the claim from the date of receipt of last necessary document.

If there is a delay beyond the stipulated 45 days, IRDAI said an interest rate of 2 percent above the bank rate has to be paid to the policyholder from the date of receipt of the last necessary document to the date of payment of claim.

Premium payment on instalments

In case the insured has opted for premium payment on an instalment basis (half yearly, quarterly or monthly), IRDAI said a grace period should be granted for payment.

However, insurance coverage will not be available from the due date of instalment premium till the date of receipt of premium by the insurer. But no interest will be charged if the instalment premium is not paid on the due date. Once the grace period is over, the health policy will get cancelled.

If a claim is filed under such EMI health plans, all subsequent premium installments have to be immediately paid by customer.

Curtesy and Source ; Money Control